Why do I need to know my tax code?
You need a tax code if you receive a salary, wages, an income-tested benefit, or any other income where tax is deducted before payment. Your tax code may vary depending on the type of income you receive.
How do tax codes work?
In New Zealand, there are two tiers of tax codes: primary and secondary.
Most employees only need a primary tax code because they have a single job. However, workers with two jobs will need both a primary and a secondary tax code.
When starting a new job, employees must complete a Tax Code Declaration form (IR330). If they have both a primary and a secondary tax code, they need to fill out an additional IR330 form for the second job and tax code.
Employers use the information on the IR330 form to determine the employee’s correct tax code and can then use the Inland Revenue’s online PAYE calculator to calculate the appropriate amount of tax to deduct from each pay cycle.
Related article: What is PAYE Tax?
What are the different tax codes?
Primary tax codes
| Tax code | Meaning |
| M | This job is the person’s main source of income and their earnings are not expected to fall between $24,000 and $48,000. |
| ME | The employee does not receive an income-tested benefit and has an income ranging from $24,000 to $48,000. |
| M SL | As above (M), but the person also has a student loan to repay. |
| ME SL | As above (ME), but the person also has a New Zealand student loan to repay. |
Secondary tax codes
However, there are also several secondary tax codes in New Zealand. These apply to people with second jobs that are not their primary source of income.
For instance, if someone has a weekend bar job in addition to their nine-to-five office job, they will have two tax codes, one for each job and employer.
| Tax code | Meaning |
| SB | The job isn’t the main source of income and earnings are less than $14,000. |
| S | The job isn’t the main source of income, and earnings are $14,001 to $48,000. |
| SH | The job isn’t the main source of income and earnings are $48,001 to $70,000. |
| ST | The job isn’t the main source of income and earnings are $70,001 to $180,000. |
| SA | The job isn’t the main source of income and earnings are above $180,000. |
Related article: NZ Tax Rates: What Are NZ’s Tax Brackets?
How do I work out my tax code?
You can use the tables above to determine your tax code. Be sure to consider the following factors when working out your tax code:
- The type of work you’re doing
- If you have a student loan
- If you have more than one source of income
These details help to make ensure that you do not overpay, or underpay, your tax during the year. IRD offers advice to working out your tax code on its website. If you’re unsure of your tax code, click this link and answer the questions under the “Determine what tax code to use” section.
About the author of this page
This report was written by Canstar Content Producer, Caitlin Bingham. Caitlin is an experienced writer whose passion for creativity led her to study communication and journalism. She began her career freelancing as a content writer, before joining the Canstar team.
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